nature, but it’s really about trying to figure out where we go
wrong and how to fix it.

Do you have a favorite example of humanirrationality?

Texting and driving. Almost everybody admits they’ve done it,
and it’s not about lack of knowledge. I’ve never had someone
say they just didn’t know it was dangerous. I think this behavior
embodies the way we’re capable of doing things that can kill us
without thinking about the long-term consequences.

How can we use our knowledge of irrationalityto do better?

One thing we know is that just teaching people about the
downsides of their decisions is not going to work. Think about
obesity. Giving people information about calories has done very
little to improve eating. Over the last 30 years, we got people
to wear their seatbelts. Why? It was a combination of annoying
beeps from the car, heavy fines and kids in the backseat
screaming if their parents didn’t put their seatbelts on. If you
can’t get people to do it for the right reasons, get them to do it
for the wrong reasons.

The moment temptation exists around you, it’s very hard to
imagine you’ll be able to fight it. This is applicable in the area of
texting and driving. The easiest thing to do would be to create
technology that helps us fight temptation — so, for instance,
your phone wouldn’t get a signal when you’re in the car.

Another approach is to create rules for behavior. With
Alcoholics Anonymous, for example, the rule is no drinking
whatsoever. If the rule was drink only half a glass a day, all of
a sudden there would be a market for really big glasses. We
need to create rules that help us figure out where we are at each
moment. If we have a rule that says I never pick up the phone
while I’m in the car, we’re less likely to fail.

Have you made changes toyour own decision-makingprocess?

Absolutely. When we moved to North
Carolina, we thought about where we
would want to live. The research on
commuting is clear: It makes people
unhappy. So we decided to live very
close to the university.

I also make rules for myself. I’vebeen traveling a lot in the last eightyears, and traveling comes witheating lots of bad foods. So I created a set of rules: I have toexercise at least three times a week, and I specified exactly whatexercising means. I can only eat dessert on weekends. Also, Icreated these rules with my cousin, and she adheres to the samerules. We agreed that we will report to each other, so we addeda layer of social responsibility. There’s something incrediblypowerful about both the rules and the social mechanism that,for me, is working very well.

Understanding human behavior can help us makebetter individual decisions. Do you think behavioraleconomics can also help address bigger societalissues?

Yes. For example, we are doing experiments now to understand
incentives for saving money among people in poverty in
Kenya and also among people with lower incomes in the
United States. The research we’re trying to apply is not just for
people that are well educated and well off. More and more,
we’re trying to apply our findings to people who live more
challenging lives.